WRAFT REPORT Winter 2004/2005
From the Executive Director
Political Support
Area Rating
Rising Waterfront Values
From the Executive Director
The year 2005 is critical in our efforts to achieve property tax reform on behalf of our member associations across Ontario. We will report quarterly to our members on our progress. I ask that you circulate WRAFT REPORT to your membership. We are going to need them to be informed and we are going to need their help if we are to achieve success.
What is success? Our objective in 2005 is to halt any further shift of tax onto waterfront properties. Why is 2005 critical? Because the province cancelled the 2004 assessment. The 2005 assessment will, unless action is taken, shift even more tax onto the waterfront in 2006. How do we know that? Because taxes are distributed based on assessment and waterfront values across Ontario continue to rise faster than values off the water.
The first Annual Meeting of WRAFT was held on November 6. We sent our members the minutes of that meeting, as well as a copy of my speech to the FOCA annual meeting on the same day. The speech is posted under News on this web. It provides a review of the progress to that date. I will quickly update that report:
- Our membership now stands at 98 associations, close to our target of 100 by year-end.
- Our fundraising continues. By year end we had raised $134,000 in donations, $19,000 in membership fees and $25,000 in contributions from the founding members. After expenditures of $48,000 we had $130,000 in the bank.
- Meetings with Queen's Park politicians and staff continue and we are identifying a professional lobbyist who can help us in our efforts.
- We are starting a campaign to build political support (see separate article).
- Research has begun on precedents for property tax reform in other jurisdictions in Canada and the U.S.
How can you help? We need to build political support for our efforts. We need to continue our fundraising. This newsletter tells how you can be involved. We need to keep telling our story. Cottage Life magazine will contain an article about property taxes and WRAFT in its March issue. Watch for it. Help us spread the story to your local media and send us copies of any publicity we get in your area, good or bad. Finally, while the key lies with Queen's Park and changes to provincial legislation, be sure your municipal politicians are aware of the extent of the inequities in the present system for distributing property taxes and of the ongoing shift of tax onto waterfront properties.
Please distribute this newsletter to your members by email or hard copy or have them read it here, on our website. Also let them know that we plan to have a Bulletin Board on our website so they can exchange their views and experiences regarding our property tax system. Finally, we'd appreciate your feedback at wraft@sympatico.ca on this first issue of WRAFT REPORT.
Political Support
The time has come to make our presence known to our provincial members of parliament. We recently wrote to our prinicipal contact with each member association and encouraged their directors to write to their MPPs where trhey live as well as to the Finance and Municipal Affairs Ministers and express theire concerns about the present property tax system. We are now asking that this letter writing campaign be broadened to include the full membership of your associations. MPPs and Ministers need to need to understand that the present system for distributing property taxes based on assessment is inequitable and is creating hardship for waterfront property owners all over Ontario. We have to build political support and we now have a membership of sufficient size that we can get the attention of Queen's Park. But your members have to get involved; in letter writing, emailing, phone calling and generally making their case to the MPPs where they live and vote. We are not going to provide a form letter for your members to sign, because that will not do the job. We want them to express their own concerns about the impact on their taxes and the unfairness of the system. The 98 associations belonging to WRAFT have some 25,000 members across Ontario. Based on a recent poll, we estimate there are four voters per member. This means that WRAFT represents roughly 100,000 voters in this province. It's time to tell our story.
Area Rating
In December we met with staff from the Finance and Municipal Affairs and Housing ministries. One subject discussed was Area Rating. Following from the meeting are notes prepared by Noel Thomas, Director of WRAFT and Chair of the Tax Committee of FOCA. This is recommended reading for all our members.
"Present legislation enables a Municipality to determine an Area, within their municipality, that is less-serviced than others, and also puts less cost on the Municipality for their services, than other areas. The Municipality can then assign a more appropriate tax rate for that area. The news is that the ministry estimates that only about 40 to 50% of the Municipalities have used this enabling legislation. Obviously this requires more administrative work for a municipality, and they may not want to initiate that work, without some political provocation. If you truly believe that you have an under-serviced area, and consequently are putting fewer costs into the municipal budget than other areas in the municipality, then you will be well advised to pursue your case with your local councillor and Mayor to use the present legislation to get relief. Only certain services can be area-rated in the legislation. Any of the following qualify:
- Culture, parks, recreation and heritage systems
- Waste management systems
- Fire protection and prevention systems
- Parking systems, except on highways
- Transportation systems, other than highways
- Sewage systems
- Water systems
- Drainage and flood control systems, including storm sews
- Street lighting
Identify other services that could be added to the list, above. If you can identify other services that are used unequally, within your Municipality, there is a possibility that the list could be lengthened. This does not need a legislative change, only a Regulation change that can be handled by the Minister of Municipal Affairs and Housing. You would have to get consensus from your local Council and make application to the Minister."
Rising Waterfront Values
Through an Internet service called Google Alerts, and by using key words 'waterfront property tax', you can get a daily report on media articles across North America containing those words. From this source it is clear that waterfront values are rising dramatically in recent years all over the continent. It's also clear that most jurisdictions have some form of assessment system on which property taxes are allocated and that in Maine, Massachusetts, North Carolina, Michigan and Florida, to name a few, this is creating distortions, as in Ontario, in the distribution of property taxes. Many jurisdictions have some form of tax or assessment capping which modifies the shift of taxes. Some other states are looking at changes to legislation to modify assessment and tax regimes. WRAFT has engaged professional help to analyze property tax regimes across North America with particular attention to areas with waterfront. This research will be of great interest as we work to develop tax reform alternatives. Of specific interest in Canada is legislation enacted in Nova Scotia in 2004, which will cap increases in assessment and is retroactive to 2001. The annual assessment system based on market value will continue but for tax purposes, assessment increases will be capped each year. In Nova Scotia waterfront values have been rising for years in part due to demand from U.S. and offshore buyers.
WRAFT is a coalition of waterfront associations across Ontario. It was formed to lobby for a more equitable property tax regime, and for a halt to the ongoing shift of tax onto waterfront properties.
Contact
Bob Topp, Executive Director
131 Bloor St. W. Suite 200
Box 263
Toronto, ON M5S 1R8
Email: wraft@sympatico.ca
Website: www.wraft.com